Accounts receivable is classified on the balance sheet as a
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Show how Accounts Receivable, Notes Receivable, and their related accounts would be reported in the current assets section of a classified balance sheet at the end of the quarter on March 31.
a. During January, the company provided services for $300,000 on credit.
b. On January 31, the company estimated bad debts using 1 percent of credit sales.
c. On February 4, the company collected $250,000 of accounts receivable.
d. On February 15, the company wrote off a $3,000 account receivable.
e. During February, the company provided services for $250,000 on credit.
f. On February 28, the company estimated bad debts using 1 percent of credit sales.
g. On March 1, the company loaned $15,000 to an employee who signed a 4% note, due in 9 months.
h. On March 15, the company collected $3,000 on the account written off one month earlier.
i. On March 31, the company accrued interest earned on the note.
j. On March 31, the company adjusted for uncollectible accounts, based on the following aging analysis, which includes the preceding transactions (as well as others not listed). Prior to the adjustment, Allowance for Doubtful Accounts had an unadjusted credit balance of $9,000.
Number of Days Unpaid
Customer Total 0-30 31-60 61-90 Over 90
Aerosmith $ 2,000 1,000 1,000
Biggie Small 2,000 1,000 1,000
Others (not shown to save space)99,000 39,000 42,000 9,000 9,000
ZZ Top 7,000 7,000
Total Accounts Receivable $110,000 $47,000 $43,000 $10,000 $10,000
Estimated uncollectible (%) 5% 10% 20% 40%